Social Network and Enterprise - Starbucks - Case Study Example

SOCIAL NETWORK AND ENTERPRISE Module Module leader’s Word count 2064 Contents Table 0 Introduction 32.0 Main Findings 3 2.1 Advantages of social networking presence at Starbucks 3 2.2 Disadvantages of social networking presence at Starbucks 5 3.1 Effective solutions for building a social presence at Starbucks 9 1.0 Introduction This report explores the Starbucks Corporation in the context of its social network. The report is intended to review the major benefits and disadvantages that the company has realized because of incorporating a social network strategy in its operations. This is with the aim of developing strategic proposals that the company can utilize to develop its social presence. The researcher gathered the information by conducting an extensive literature survey of journals, reports, books, statistics from relevant agencies and other reputable sources that provided important information about the company. The reports used articles published in the recent dates to ensure that the most recent statistics are used in describing the situation at the company. Starbucks ranks among the top global enterprises that have successively adopted effective social network plans. This validates the selection of the company because other enterprises can learn from the company. According to Evans (2012), social network provides the ultimate strategy of running businesses in the contemporary world. This affirms the need of evaluating the subject in order to empower businesses with the essential knowledge of social network that would enable them improve their performances. 2.0 Main Findings 2.1 Advantages of social networking presence at Starbucks The report identified the subsequent factors as the major advantages and the disadvantage of adoption of social network strategy at Starbucks. Initially, social network has developed the Starbuck’s brand popularity and equity. According to Poston (2012), social network provides brands with the opportunities of interacting with customers through networks. Starbucks has utilized social media in creating good impressions of their brand that has developed it equity. Perera et al. (2009) examined the performance of the Starbuck’s brand over the time. The scholar noticed that the brand started experiencing attractive popularity from the year 1996. This highlights the effect of the social network in developing the company’s brand because this year presents the time when Starbucks adopted a functional social network strategy. Perera et al. (2009) affirms that Starbucks has grown its brand through mergers, joint ventures and internationalization. This is promoted by the Starbuck’s technology-based marketing strategy that attracts global investors. Through the social network, Starbucks developed from a local retail business to multinational enterprise. Furthermore, the social network has provided Starbucks with an effective strategy of improving their customer service and feedback. Emily (2010) argues that providing support to consumers is an important practice that determines company’s success. The scholar indicates that business should respond to customer’s inquiries in a helpful manner without considering whether the input is good or bad. Starbucks has its model of social network that it operates under the title “My Starbucks Idea” (Gallaugher & Ransbotham, 2010 p. 199). The site allows users to view suggestions from others, vote on proposals and check out the results. This strategic site has considerably increased the quality of the company’s customer service (Evans, 2012 p. 64). Sigala conducted an inquiry to determine the effect of the social network and customer involvement on the company’s performance. The scholar used the Netnography approach to analyze his data. The study highlighted that online customer’s interaction provided the customers with an opportunity of sharing and understanding the context of using the company’s services (Sigala, 2012 p. 966). This practice triggers emotions and cognition that increase customers’ creativity. This is advantageous to the business because especially when it has a mechanism of tapping proposals from customers. Sigala (2012) argues that the variety of the consumers and the sharing of their diverse perceptions have a constructive effect on businesses because users propose new ideas. This has offered Starbucks a competitive advantage because the company has a rich pool of gathering vital concepts. Gallaugher & Ransbotham’s study identified that the use of social media has enriched the customary customer and firm interaction. Social network has provided Starbucks with the opportunity of reaching large numbers of the consumers. The company launched the “Starbucks Facebook Page” in the year 2008 and presently the page have more than 27, 600, 000 fans. Having access to large numbers customers is beneficial to the business because the company can easily market its services (Perera et al, 2009). Despite the large coverage, social network has provided Starbucks with a less costly approach of advertising their services to the global community. Social network provides a virtually free approach of marketing business activities. This is because the company scouts potential consumers and target market by using less costly social network tools such as referral links, Ads and viral posts (Bush, 2008 p. 20). 2.2 Disadvantages of social networking presence at Starbucks Despite the highlighted advantages, the adoption of social network strategy has also challenged Starbucks in various ways. Initially, the social network has made the business lack anonymity (Plog, 2005 p. 288). This is because the plan demands Starbucks to disclose its entire information including its location, financial performance and its strategic plans. This is detrimental to the company because competitors or individuals with ill motives may utilize such information to attack the company. Furthermore, disclosing information to the public create more opportunities for criticisms that may affect the company’s procedures (Gallaugher & Ransbotham, 2010). The social network strategy is also disadvantageous to the company because the model consumes a lot of time. Maintaining an active social network system is highly strenuous. The system has obliged the company with the duty of responding to millions of inquiries posted by the customers (Gallaugher & Ransbotham, 2010 p. 198). Consequently, the company invests a lot of time in managing it social systems. This is disadvantageous to the company because such effort could bring returns if channeled to other business activities (Emily, 2010 p. 34). The social networks model has also increased the company’s vulnerability to frauds and harassment. Social networking causes failure of security in personal and business contexts. Cases like cyber-stalking, identity theft and online frauds are common within social network schemes (Plog, 2005 p. 287). Furthermore, the system demands the company to respond to each individual including the ones with ill intentions. Often, some users who have ill intentions harass the company using the social network tools. Starbucks have constantly become a victim of such harassments (Bush, 2008). 3.0 Analysis and Conclusions Starbucks has successfully adopted the social media technology and currently the company is making attractive returns from its social activities. The company sells its products from its online store the “starbucksstore.com.” Furthermore, it has utilized strategic social networking strategies that have attracted large numbers of online clients. The company’s social strategy centers on its corporate site, regarded as “My Starbucks Idea” and on its Facebook and Twitter pages (Sigala, 2012). The Starbucks Idea is a social platform that encourages consumers to post suggestions, place inquires, vote for ideas and vent their frustrations. The forum has about 200, 000 registered users who discusses and collaborate on generating new ideas (Poston, 2012 p. 24). The company responds to the community through its monthly blog, the “Ideas in Action.” In this blog, the company’s staffs discuss the new development and announce the community contest winners. Often, the company offers incentive for the outstanding suggestions (Perera et al, 2009). The company has millions of followers in the Facebook with its page being one of the most popular. The company is offering an excellent online marketing interaction experiences on the site. The company conducts social commerce regarded as the f-commerce through their fully integrated site. Furthermore, the company provides its users with a procedure of reloading their Starbucks virtual card with payment card to facilitate payment procedures. Users can also reward their Facebook friends by reloading their cards (Emily, 2010). Starbucks uses Facebook events, discussions and well-coordinated Ad promotions to increase traffic both to its physical and virtual stores. The company also interacts actively with its Twitter followers. According to Poston (2012), the company had about 1,234,985 followers in Twitter by 2011. The company ignites conversations on Twitter whenever it has new campaign or update. Consequently, news spread in Twitter before appearing in other channels that provide it with an opportunity of creating buzz and evoking sentiments from the Twitter users (Brandau, 2009). Increase in the company’s Twitter Followers in the first seven months Source (Bush, 2008). Furthermore, the company has social presence in LinkedIn, YouTube and Flicker. The company’s LinkedIn profile had more than 49,000 followers by July 2011. The firm provides its business data, describes its new hires and advertises the available managerial positions through the LinkedIn site. Furthermore, the company runs frequent campaigns on YouTube and Flicker. For example, it has promotion videos and photos for view in both sites (Bush, 2008 p. 21). 3.1 Effective solutions for building a social presence at Starbucks The company can adopt strategic procedures to develop their social presence further. The subsequent practices will be effective in building Starbuck’s social presence. Initially, the company needs to optimize its social presence by ensuring that all its social profiles are complete and efficient. The company needs to ensure that its LinkedIn updates, Facebook posts and tweets are optimized with strategic Keywords for the business to ensure that customers can trace them easily through search engines (Divol, Edelman & Sarrazin, 2012 p. 67). The company should utilize strategic schemes such as posting icons to increase its social visibility. Consequently, Starbucks should ensure that all its pages have “follow” buttons and icons such as email signature, e-newsletters and strategic blogs. Moreover, the company can also promote its social accounts in print such us on flyers and business cards. The company should take advantage of diverse social platforms. Bush (2008) asserts that the current internet users are perceptive. This means that the Starbucks need to synchronize its social accounts and keep them updated. For example, the company should ensure that its LinkedIn profile provides links to all company’s blogs, tweets and Facebook updates. The company can increase the activities of its LinkedIn profile by integrating it with the Twitter feed. Moreover, the company should integrate various media such as video blogs and podcast into its social channels. This should include designing strategic viral contents that can link customers to the company’s sites (Divol, Edelman & Sarrazin, 2012 p. 70). The company should also develop partnerships and relationships. This defines the need of utilizing tools like the Tweet Grader, Twello and other vital search mechanism to identify strategic local and international industries that can fund their promotions. After identifying such companies, Starbucks should start following and engaging them in constructive conversations (Evans, 2012 p. 19). Furthermore, the company should follow other popular bloggers while retweeting their contents. The company can approach local businesses and convince them to donate prizes for the contests held in their social sites. For example, the company may negotiate with local stores and request them to offer gift certificates for its users in exchange for advertising on the company’s social medial channels (Plog, 2005 p. 285). Considering the popularity of the Starbuck’s social sites, most local enterprises will be willing to develop business deals with the company. Starbucks can develop it relationships by maintain an active interaction with its fans and followers. Consequently, the company should invest more resources in support framework to ensure that inquires from fans are accorded appropriate attention (Divol, Edelman & Sarrazin, 2012 p. 68). Lastly, the company should improve the conveniences of their social accounts and offer incentives. This includes ensuring that users have easy method of creating accounts, accessing them and sharing contents with their friends. According to Divol, Edelman & Sarrazin (2012), users are discouraged by social applications that are hard to operate. A strategic approach of improving applications’ efficiencies entails simplifying authentication procedures. Incentive plans should include rewarding the most active fans and followers to encourage them share the company’s contents. Furthermore, the company should run blogs contest and reward winners accordingly to encourage users to post promotion blogs and share their experiences with the company (Brandau, 2009 p. 1). Effective implementation of these strategies will help Starbucks increase its social presence. However, the company needs to monitor the productivity and effect of each strategy on the company’s activities. Consequently, strategies that present poor performance or ones that create detrimental consequences to the company should be avoided and new procedures adopted. Furthermore, the company should accord more emphasize to strategies that indicate high productively. This will provide the Starbucks with a strategic scheme of taking advantage of the social networks making it outshine its competitors. 4.0 Reference List Brandau, M. 2009, "Starbucks brews up spot on the list of top social brands in 2008", Nations Restaurant News, vol. 43, no. 12, pp. 1-1,31. Bush, M. 2008, "Starbucks gets Web 2.0 religion, but can it convert nonbelievers?", Advertising Age, vol. 79, no. 12, pp. 1-1,28. Divol, R, Edelman, D, & Sarrazin, H 2012, Demystifying social media, Mckinsey Quarterly, 2, pp. 66-77, Business Source Complete, EBSCOhost, viewed 28 November 2012. Emily, B.Y. 2010, "Starbucks Gets its Business Brewing again with Social Media", Advertising Age, vol. 81, no. 8, pp. 34-34. Ronald, J.D. 2010, "Social Network Driven Innovation", The ISM Journal of International Business, vol. 1, no. 1. Evans, D. 2012, Social media marketing: an hour a day. Indianapolis, Ind, Wiley. Gallaugher, J, & Ransbotham, S 2010, Social media and customer dialog management at Starbucks, MIS Quarterly Executive, 9, 4, pp. 197-212, Business Source Complete, EBSCOhost, viewed 27 November 2012. Perera, L, Kerr, R, Kimura, H, & Lima, F 2009, Case study: Starbucks- adding value to brand equity through an innovative brand image, Journal Of The Academy Of Business & Economics, 9, 4, pp. 174-185, Business Source Complete, EBSCOhost, viewed 27 November 2012. Plog, SC 2005, Starbucks: More than a Cup of Coffee, Cornell Hotel & Restaurant Administration Quarterly, 46, 2, pp. 284-287, Business Source Complete, EBSCOhost, viewed 28 November 2012. Poston, L. (2012). Social media metrics for dummies. Hoboken, NJ, John Wiley & Sons. Sigala, M 2012, Social networks and customer involvement in new service development (NSD)The case of www.mystarbucksidea.com, International Journal Of Contemporary Hospitality Management, 24, 7, pp. 966-990, Business Source Complete, EBSCOhost, viewed 27 November 2012. 5.0 Appendices Source 1 Source 2 Source 3 Source 4 Starbuck’s social site Starbucks on Twitter Bottom of Form Read More